Bank Negara Malaysia (BNM) decided to cut the Overnight Policy Rate (OPR) by 25 basis points to 3% from 3.25% at its Monetary Policy Committee (MPC) today amid weak economic outlook.
This is the first adjustment since January 2018.
“The ceiling and floor rates of the corridor for the OPR are correspondingly reduced to 3.25% and 2.75% respectively,” the central bank said in a statement today.
BNM said latest developments in Malaysia point towards moderate economic activity in the first quarter of 2019.
“Looking ahead, slowing global demand conditions and subdued growth of key trading partners will continue to weigh on the external sector.”
The central bank noted that while domestic monetary and financial conditions remain supportive of economic growth, there are some signs of tightening of financial conditions.
“The adjustment to the OPR is therefore intended to preserve the degree of monetary accommodativeness. This is consistent with the monetary policy stance of supporting a steady growth path amid price stability. The MPC will continue to monitor and assess the balance of risks surrounding the outlook for domestic growth and inflation.”
Source: The Sun Daily